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Placing the blame or assigning the credit to WikiLeaks |
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It’s been all over the news, in recent months especially. The information gathering “mother load” for all things designated newsworthy (and some that simply are not) has caused a kettle of controversy over some subjects they have recently brought out into the light of day. Among them have been the financial crisis over mortgage loans with the Fanny Mae’s along with the Freddie Mac’s being put under the microscope to determine how much damage they created during the past five or so years. The firestorm of controversy tends to revolve around how much guilt to assign and proving the validity of the information presented.
Did the foreclosure crisis do permanent damage to US economy?
With millions of foreclosed homes on the market on any given day, and financial ruin close at hand for many millions of Americans, there has to be someone or something to point the finger of blame toward. Have over eager lenders doled out too many overpriced mortgages to the home buying public simply to line their own pockets? How much blame can be placed on those eager home buyers who found that they could qualify for a home after all? The House Oversight Committee and its newly appointed chairman Darrell Issa is expected to come down hard on those who played a large part in the financial crisis that arose as a result of the avalanche of foreclosures occurring during the past several years.
The Financial Crisis Commission points blame toward Mac & Mae
In a report given by the Financial Crisis Committee which has been delving into the foreclosure situation, much of the blame can be placed directly on those two major lending associations. Fanny Mae as well as Freddie Mac have pushed lending to new highs (or lows depending on the point of view) over the past decade. And with no respect or consideration for home valuations, they encouraged home buyers to take on mortgages they could barely afford. When the bottom fell out of the real estate price market those who had previously teetered on the edge of taking on late charges for their mortgage payments found they absolutely could not afford to remain in their home yet could not afford to sell because they were “upside down” in regards to their home loan. They owed more than their home was currently worth and no one would buy their house for the amount required to pay off the existing loan. Long story short, those who were stuck with an overpriced mortgage had to move out and find a residence elsewhere. Even renting can prove to be a difficult proposition when the credit score falls substantially due to a foreclosure on the records.
Enter WikiLeaks with the witch hunters
WikiLeaks tells it like it is… with proof to back it up. While helping the Freddies and the Fannies survive through their individual financial disasters, super bank the Bank of America, with nearly three billion dollars (that’s billion with a B) there is evidence that some underwriter standards may not exactly have been met when the money was doled out. The BofA and other rival banks felt pressure from both Freddie and Fannie to buy back some of the mortgages they lent under the pressure involved in keeping their collective ships afloat since 2006. Bank of America sold many mortgages through their own lender, Countrywide Financial. The claims that came in, mostly from private investors stating they were sold some mortgages that later proved to be full of fault, have yet to be resolved for the most part. The housing price crisis is yet to be resolved and may not for some years to come. Even though many of the larger lenders have been sunk due to the financial debacle of recent years, some have persevered and with luck and patience will come out still paddling and with their pride remaining intact.
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